The superintendency of the financial system will manage a centralized payroll database to ensure the accuracy and integrity of payroll data. This system will contain unified information on all affiliates and employers registered in the Pension Fund Administrators (AFP), the Salvadoran Social Security Institute (ISSS), and the Pension Unit, as well as the Superintendency itself.
How Does the New Payroll System Work?
Employers will use the Unified Payroll System (SPU) to prepare and declare payrolls for both the Pension System and the Salvadoran Social Security Institute. This system will determine contribution amounts and generate payment obligations based on submitted payroll declarations. The SPU came into effect on July 1, 2023.
Key Changes and Benefits of the SPU
The Unified Payroll System replaces the Virtual Office of ISSS (OVISSS) for Social Security reporting and the Provisional Payroll System (SEPP) for Pension Administration reporting. This integration aims to eliminate inconsistencies and enhance administrative efficiency for both employers and institutions.
The Superintendency will manage user roles and access to the SPU platform for payroll processing. Employers must follow these steps:
- Request electronic registration for their business by completing the required fields in the designated forms.
- Once registered, employers receive login credentials to access employee data, prepare, declare, and pay payroll contributions.
- Employers must configure payroll settings to ensure compliance with pension and social security contribution regulations.
- User creation and management will be handled according to technical manuals provided by the Superintendency.
- Employers must ensure secure handling of login credentials and payroll records to protect data integrity and privacy.
Employer obligations under the new payroll system
With the implementation of the SPU, employers must adhere to new responsibilities, including:
- Keeping employee records updated in the SPU platform, including salary details, tax deductions, and other relevant data.
- Calculating wages and deductions in compliance with current labor and tax laws.
- Generating and submitting electronic payment receipts to authorized financial institutions.
Additional Considerations
- Financial institutions must report payroll payments to the Superintendency in real time.
- The Superintendence will share payroll data with the Pension Institute for auditing and compliance purposes.
- The Superintendency will update the SPU as needed, ensuring compliance with legal requirements and maintaining up-to-date payroll management guidelines.
Institutions Linked to the Unified Payroll System
- The SPU involves multiple entities, including:
- Pension Fund Administrators (AFP)
- Salvadoran Pension Institute
- Salvadoran Social Security Institute (ISSS)
- Financial institutions managing pension fund accounts
Employer Benefits of the New Payroll System
The SPU offers several advantages for employers:
- Simplifies payroll processing, consolidating pension and social security contributions into a single monthly report.
- Reduces administrative burden, eliminating previous forms and redundant processes.
- Prevents payroll inconsistencies through automated validation.
- Enhances transparency in contribution reporting.
- Provides real-time payroll access, improving financial planning and workforce management.
